That was a very interesting night’s trading in the SPX. Broke the downtrend from the beginning of May and did it in real style slightly exceeding the high from early this month. The answer to a girl’s prayer. The good thing is that it gives the SPX room to correct without causing too much damage to the pattern.
I think traders and investors need to be aware of the fact that the SPX is trading up in the area of old highs so there is going to be a lot of overhead resistance to deal with. There will be times when it looks to be all over and other times when it is giving off optimistic vibes – so be ready for some confusing analysis from us all as we try and weigh it all up. Already the SPX is getting towards overbought on the STO. I had a conversation on the Day Traders thread just yesterday on how well the STO’s are working in the current environment – don’t know why one particular indicator would have a higher reliability than at other times but who are we to question the machinations of the market.
Would have liked to see a bit more strength in the RUT (Russell 2000). This covers a lot of the smaller cap stocks. Dragging its chains a bit at the moment - this needs to be rectified.
SOX (semi-conductors) had a HUGE day. Looks like it has confirmed a double bottom.
The US dollar has now had four little down days so it looks like we could still have trouble when it bounces. Unfortunately that will put the spotlight back on the support line in gold and silver.
Europe was very strong. But another market that I thought was interesting was Brazil. Looking to see if we are confirming a bottom there. Worth watching this one.
Will be interested today to see how the SSEC goes. That is what is holding us back but I have really fabulous positive divergence there on one of my indicators so hoping it soon comes into play.
Heard this morning that Germany sold bonds overnight with a negative yield. That is right a NEGATIVE YIELD. Any wonder that money is pouring into Australia from places like Germany when our banks, which already are considered some of the safest in the world, are still giving a reasonable yield even after such strong rises. Shame they don’t fancy our miners as well!!!
Grains continued their blistering run. Gold ignored it again but I am concerned about the long term effect these grain prices are going to have on the cost of food but obviously markets don’t seem to be sharing my concern – well at least not for the moment.
The 18th was the end of one of my timing boxes – the next is 28th/31st of July.
(20min delay)